David, I read the article, what you are referring to is largely
a question of social welfare, as distinct from the economy. Yes,
there are all sorts of sad cases out there, for all sorts of reasons.

In the case quoted, somebody with brain injury should really be
taken in by sheltered workshops etc, for employment. Ice and
the increase in meth use is another reason for poverty, because some
people simply become unemployable. Employers have to abide by OHS
rules and machinery and drugs just don't mix.

The other issue is tobacco. By what I've read, people with some
mental issues like schizophrenia have incredible issues with trying
to quit, so the Govt screwing up prices to force them, is not
helping, but rather helping create poverty, as seems to be the case with your quoted Harry.

I know pensioners who live in the country, don't smoke, grow a
few vegies and can live very well indeed on similar money as your
Harry is receiving. The thing is, the Govt spends about 120 billion
$ a year on social welfare, how much more should they spend?

Back to the economy, all the figures that I've seen agree with
Rhian's point that real wages in Australia have never been higher.

David
I accept there is poverty in Australia. But

1) The article makes no mention of whether poverty has got better or worse over recent decades.

2) Even if poverty has increased, that doesn’t necessarily mean that people are worse off in absolute terms.

Poverty in countries like Australia is not an absolute measure, like the UN’s US$2 a day benchmark for absolute poverty. In Australia poverty is usually gauged by a relative measure, comparing the incomes of those at the bottom of the income structure with the rest (most commonly the Henderson poverty line). If every household in Australia tripled its income overnight, the number of people in relative poverty would remain exactly the same.

For example, ABS data show that in the ten years to 2007-08, average real disposable household income for people in the low income group increased by 41%, while average real income increased by 46% for middle income people. This means that absolute living standards for low income earners rose substantially, but because other groups’ real income rose even faster, relative poverty may have increased.

http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/1370.0~2010~Chapter~Household%20economic%20wellbeing%20(5.3)

Your argument requires not only that poverty exists (as the article you link to argues, and which I accept), nor even that poverty has increased (which the article does not discuss), but that ABSOLUTE poverty has increased – that is, the real incomes of people on low incomes are declining. And that is clearly not the case in Australia.

Just thought I'd toss this into the mix.

Poverty and income in America - circa 2011:

http://www.newyorker.com/online/blogs/johncassidy/2011/09/poverty-figures.html

Poirot

Yes, I’ll accept that the growth in living standards we’ve enjoyed in Australia has not been matched by the USA. The US is (we hope) emerging from their worst recession since the second world war, and this will have distorted their data recently. But even so the evidence of sluggish growth in incomes for middle income families was there before the recession.

If free trade were the cause, then you’d expect countries that reduced trade barriers to have the worst growth in living standards (the reverse is true); or trade exposed countries to be more vulnerable (The USA derives less GDP from trade than most developed economies), or similar patterns to be evident in similar economies (European developed and emerging economies do not record this phenomenon - nor do Canada, Australia or New Zealand, although Japan’s growth has been fairly anaemic).

Most economists I have read do not attribute the cause to free trade or globalisation. Paul Krugman, for example, attributes it to US domestic policy and political characteristics and policies.

And even the sluggish US growth does not justify David’s alarmism, which says that living standards must deteriorate, not merely stagnate, with free trade.

Rhian: The link is that the US is the biggest economy in the world and should have benefited from globalization.
I do not think the millions there who are living in poverty, would agree with that. So why would anyone want to emulate a country and system where there is enormous poverty except for a minute percentage that are very rich.

Yabby: you say maybe if there were no more cheap kids clothes and shoes. No more computers or the Internet for the poor, only the rich could afford the price.
No more affordable power tools.

We could get stuck in and make them ourselves. Are you going to give me the old furphy about: you cannot compete because of the economy of scale?
If we were making them for ourselves, we would have more jobs and would not have to compete with sweated labour from Asia and Africa.

The other point is that with the approaching “peak everything” we will have to learn to manage with out all these things. In the bad old days woman had sewing machines and made a lot of their clothes themselves. We used to have very proficient shoemakers.
As for the pensioners battling away in there sheds, if they are able to do that, there would be paying jobs for them to do instead of being thrown on the scrap heap or used as the excuse to bring in hundreds of thousands of migrants, to support out “aging population”.